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FOUNDATIONS OF INFORMATION SYSTEMS
Ch
ap
ter
5
BIS 1202
Introduction to Organisations and Information Systems
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• Organisations
• The organisation and its environment
• Why do organisations exist?
• Organisation vision, mission, goals, objectives
• Organisational structure
• Organisation culture
• Types of IS in an organisation
Overview
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“A social arrangement for achieving controlled performance in pursuit of collective goals.”
(Huczynski & Buchanan, 2001)
Organisations
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Organisational Behaviour“The study of the structure, functioning
and performance of organizations and the behavior of groups and individuals within
them.”
(Huczynski & Buchanan, 2001)
Organisations
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Organisation
Customers Suppliers Competitors Investors Regulators
Technology Knowledge
IS(Laudon and Laudon, 2006:78)
The Organisation & its Environment
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• Organizations exist because they offer many advantages over people acting alone. Synergy (1+1=3), division of labour, formal systems of responsibility
• Organizations exist to serve a purpose or achieve a goal which is difficult to achieve by individuals alone
Why do Organisations Exist?
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• The purpose of an organisation is expressed through its mission statement, goals and objectives
• The key to organisational effectiveness lies in its systems of responsibility and authority
• The purpose of existence of an organisation, its values and aspirations are usually expressed through its mission statement. In order to be successful, the organisational structure, culture, behaviour, and design should complement the mission of that organisation
Vision, Mission, Goals, Objectives
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Organisation
Vision
Mission Statement
Goals and Objectives
An aspirational view
A general expression of the overall purpose
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Example:
“To become the most successful worldwide telecommunications group”
(Campbell and Craig, 2005:29)
Vision
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Mission statement may contain: • Some indication of the industry• The market position aiming towards• Values and beliefs• Context-dependent objectives
Mission
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Example:“To provide world class telecommunications and
information products and services,
To develop and exploit our networks at home and overseas, so that we can:
• meet the requirements of our customers,
• sustain growth in the earnings of the group on behalf of our stakeholders,
• make a fitting contribution to the community in which we conduct our business”
Mission
(Campbell and Craig, 2005:29)
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• Broad-based intentions derived from the mission
• Provides a sense of direction in achieving the vision
• Usually expressed in qualitative terms and tend to be medium to long term in character
Goals
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• Provides a focus for managers
• Aspirational targets; more recognisable; achievable
• Usually expressed in quantitative terms
Objectives
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S
M
A
R
T
Specific
Measurable
Achievable
Realistic
Time related
Explicit statement of required outcome
Means of assessing results against plan
Within the capabilities of people and resources employed
Practical and sensible assessment of capabilities
Where relevant completion dates
Objectives
When setting objectives:
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Refers to organisational sub-units and the way they are related to the overall organisation
Organisational Structure
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Objective of the organisational structure
Means of attaining objectives and goals
The extent to which, and the ways in which, one is controlled and constrained
Organisational Structure
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• Traditional or hierarchical structure
• Project organisational structure
• Team organisational structure
• Multidimensional organisational structure
Organisational Structure
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Chief executive
Senior executive
Department/division heads
Superintendents
General foremen
First-line supervisors
Top management
Middle management
Supervisory management
(Buchanan & Huczynski, 1997)
Organisational Structure
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Multinational companies Operate in several countries (e.g., Coca-Cola, IBM)
International organisations Do business with other companies in different countries
(e.g., Boeing) Virtual global companies
Joint ventures whose business partners are located in different countries
(e.g., Turnstone) (Turban et al., 336) Enterprise
New Business Models
“An organization with partially overlapping objectives working together for some period of time in order to attain their objectives. The actors utilize technology, competence, information and other resources in order to transform input to products that satisfy the needs of customers.”
(Christensen et al., 1995:1172)
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What is meant by the term ‘Culture’?
“A set of major understandings and assumptions shared by a group.”
Organisation Culture
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• These understandings (e.g., common beliefs, values, and approaches to decision making) are often not documented in goal statements or policies
Organisation Culture
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What’s a ‘System’?A group of interrelated components working together toward a common goal by accepting inputs and producing outputs in an organised transformation process’
(James o’Brien, 2004)
Systems Theory
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Organisation
Production process
Input from the environment
Output to the environment
Feedback
(Laudon and Laudon, 2006:73)
Systems Theory
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Organisational processes (sub systems)
Control
Inputs Outputs
Feedback
• Finance
• Revenue
• Human resources
• Physical resources
• Data, information
• New product development
• Manufacture
• Distribution
• Sales and marketing
• Physical products
• Services
• Profits
• Data, information
• Change plans
• Change resources
• Performance targets
• Performance metrics
Environment
(Chaffey and Wood, 2005:27)
The Organisational System
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The Community, Competitors Customers, Suppliers Stockholders Labour unions Financial Institutions Government agencies, etc.
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What’s ‘information’?“individuals actively create the meaning of
information through their thoughts, actions and feelings” (Wei Choo, 2000)
Information Age information society
Use of Information Technology (IT)
Transformation of work
Rethinking of business practices
Information
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What is ‘Information Technology (IT)’?
Information Technology (IT)
“Any computer-based tool that people use to work with information and support the information and information-processing needs of an organisation.”
(Haag et al., 2004)Technologies that help you to perform specific information-processing tasks
Hardware Software
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“Information systems are the means by which organisations and people, using information technologies gather, process, store, use, and disseminate information.”
(www.ukais.org)
Information Systems (IS)
What are ‘Information Systems’?
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“A Business IS (BIS) … converts data into information products that can be used to support forecasting, planning, control, co-ordination, decision making and operational activities in an organisation.”
(Bocij et al.)
Business Information Systems (IS)
What is a ‘Business Information Systems (BIS)’?
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Data
Information Systems
Hardware
Software
People
Telecommunications
(Jessup and Valacich, p1-7)
Procedures
Computer Based Information Systems (CBIS)
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Input of data resources
Processing data into information
Output of information products
Storage of data resources
Control of system performance
People Resources
End users and IS specialist
s Software Resources
programs and procedures
Har
dwar
e R
esou
rces
mac
hine
s an
d m
edia
Network Resources Communications media and Network support
Data R
esources
data and Know
ledge bases
(O’Brien, 2004, page 11)
Components of an IS
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People Resources
• IS Specialists
People who develop and operate IS. (e.g. system analysts, software developers, system operators)
• End Users Anyone who uses the information systems or the information it produces (e.g. customers,
salespersons, managers) (O’Brien, 6th Edition, page 12)
Components of an IS
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Software Resources
All sets of information processing instructions• Programs
System software (e.g. operating system programs),
Application software (e.g. spreadsheet programs, word processing programs, payroll
programs, etc.)
• Procedures:data entry procedures, error correction procedures, paycheque distribution procedures, etc.
Components of an IS
(O’Brien, 6th Edition, page 12)
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Hardware Resources
All physical devices and materials used in information processing
• Machines :Computers, video monitors, magnetic disk drives, printers, optical scanners, etc.
• Data Media: flash disks, magnetic tapes, optical disks, plastic cards,paper forms, etc.
Components of an IS
(O’Brien, 6th Edition, page 12)
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Network Resources
Communications media
Communications processes
Network access and control software, etc.
Components of an IS
(O’Brien, 6th Edition, page 12)
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Data vs. Information– Data: Facts about an event or a transaction. More formerly
you can say that data are objective measurements of the attributes (the characteristics) of entities (such as people, places, things, and events) (O’Brien, p13). Example: a sales transaction (we can collect the item descriptions and the number of each item bought, customer card details, etc. )
– Information: Produced by processing data or more simply by converting or putting data into meaningful and useful context for specific users. Example: from the data collected at the POS, we can produce information about how much of an item has moved that day, what are the products which are moving fast, how many times a week a particular customer is visiting the store, how much a particular customer spends on average per month, etc.
(Turban et al, Chapter 1 Page 18)
Clarification of Important Terms
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INPUTS
Business problems Business opportunities Data Information Instructions
PROCESSING
Programs People Equipment Storage
OUTPUTS
Solutions Reports Graphics Calculations Recommendations Forecasts Analysis Tactics
CONTROL
Decision makers Auto-control
Feedback
A schematic view of an information system (Turban et al., 2006:20)
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The Functions of Information Technology (IT)
Capture
Process
Generate
Store/Retrieve
Transmit
(James A. Senn, 23)
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39
Organisation
Different ways in which information can create value for organisations
Add value
Reduce cost
Create new reality
Manage risks
Customers and markets
Transactions and processes
Market, financial,
legal, operational
New products, new services, new
business ideas
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INFORMATION SYSTEMS IN AN INFORMATION SYSTEMS IN AN ORGANISATIONORGANISATION
BIS1202